Yesterday, the world woke up to the news that Apple discontinued the 40GB Apple TV overnight and reduced the price of the 160GB model to $229. Before the slash, the 40GB and 160GB models were priced at $229 and $329, respectively.

Although many were disappointed to find that Apple didn't unveil any updates or upgrades for Apple TV at last week's media event, it came as a double whammy when Apple seemingly began pulling the plug on the whole enchilada Sunday night. But today, David Coursey and our friends at PC World are resurrecting some hopes for Apple TV fans that the future may not be as bleak as recent events suggest.

Apple TV, which has so far been a minor failure, will get a boost from both the new iTunes LP format and a $100 price cut. However, you may want to hold off on that purchase for an expected new model.

The concept of a "new model" is being bounced around everywhere this week it seems. And in light of the upcoming holiday season and increased competition from the likes of Zune HD, Coursey is betting that within the next 4-8 weeks Apple will announce a new Apple TV, and maybe even new iPod Touch models or the "fabled Apple tablet."

With new content in the iTunes store and the potential to grab a big share of the developing online rental market, there is plenty of reason for Apple to revamp/upgrade Apple TV.

The real challenge for Apple will be finding a way to capture the imagination of consumers with Apple TV the way it has with almost every other offering Apple has introduced in recent years. For now, Apple TV lacks the awe and magic of the iPhone or the iPod. It's just missing that intangible.... something.

Piper Jaffray analyst Gene Munster suggests a possible "rental model," in line with Netflix. Could that be the way to go for Apple TV? It seems we're going to find out sooner than later. And it couldn't possibly come soon enough for fans who can't help but see Apple TV as being on life support at the moment.

I say scrap the entire thing and put the software into a Mac Mini with a 500GB hard drive and a Superdrive Blu-Ray Player. Be able to use it as a DVR. It already has mini dv convert that to HDMI to go through the TV.

Thats what I would like to see. Make it more of a media center mac. So it can do more than just sit there and stream movies to it. Set it up so I could stream it from my 1TB Time Capsule. I think thats what we are going to see if anything. Something with all of that integrated into it. Makes more sense.